Smiths Group on track despite revenue dip across two divisions

Michael Bow
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ENGINEERING company Smiths Group yesterday said trading was in-line with expectations after revenues and operating profits rose last quarter.

The group’s outgoing chairman Donald Brydon told the company’s annual meeting that revenue at two of its units – Smiths Medical and Smiths Interconnect – fell in the three months ending 2 November.

Strong revenue growth in its other three divisions – John Crane, Smiths Detection and Flex-Tek helped offset this, he added.

“Expectations for the year remain broadly in line with the outlook given at the full year results, although foreign exchange translation is expected to be a headwind at current rates and sales to government-funded customers remain a risk,” Brydon said.

Numis analysts warned the company’s slow growth was hampering its recommendation as a stock pick.

“The current round of rationalisation and associated charges will be reinvested but this will take time to impact the top line,” analyst David Larkam said.

Shares fell 2.3 per cent to close at 1,400p. The company also said net debt had fallen £4m down to £740m between July and November.

Brydon stepped down as chairman yesterday. He has been replaced by deputy Sir George Buckley.

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